The Canary Islands is the Autonomous Community that will create more jobs over the next year. The BBVA Research Service (BBVA Research) estimates that the number of jobs will increase by 2021 by 2.4%, that is, seven tenths above the national average (1.7%). That improvement in 2021 will be a continuation of what the labor market of the Archipelago will experience already this year. According to BBVA Research, which yesterday updated its macroeconomic forecasts for this and next year, employment will grow by 1.7% in 2020, in this case the second largest increase among the 17 autonomies only behind the Community of Madrid (2 ,5%). Thus, the Islands will be at the forefront of job creation in Spain both this and next year, and even when there are “uncertainty factors” on the horizon.
In fact, BBVA experts keep the Canary Islands as the region that will grow the least this year, with an increase in its Gross Domestic Product (GDP) of only 1.1%, compared to 1.6% on average. If the forecast is fulfilled, the economy of the Archipelago would effectively grow, but it would be half a point less than the national economy. Looking ahead to 2021, the outlook is more optimistic, since BBVA Research’s forecast is for regional GDP to increase 1.8%, seven tenths more than this year. Of course, this sensitive improvement will not allow the Islands to reach the national average, since the Spanish economy will grow in 2021, always according to the forecasts of the financial institution’s study service, 1.9%, that is, one tenth more than in the Canary Islands. The update of BBVA’s macroeconomic forecasts thus leaves a better outlook for the labor market than for the behavior of GDP, although the study emphasizes the variables that can alter these calculations.
In the first place, and although the initial risk seems to have eased, BBVA Research emphasizes that the two regions most exposed to the risk of the British reducing their budget for vacations once the departure of the United Kingdom from the United Kingdom is consumed the European Union. In addition, the report of the entity recalls the “negative surprises” that has taken in recent months the regional tourism sector with “the financial problems of tour operators”, with the bankruptcy ofThomas Cookas the main exponent, and “the decrease in the number of available airplane seats”. Another factor that plays against the Canarian economy is the evident deceleration of the real estate market, which although it is occurring in the whole country, is especially pronounced in the Islands.
Of course, in 2021, BBVA Research explains, “the widespread recovery of external demand, both for goods and services, favored by more favorable growth prospects for European countries, should push the exporting autonomous communities and contribute to the acceleration of the Balearic and Canary Islands “, hence the best expected behavior of GDP and employment for the next year.